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“The only thing necessary for these diseases to the triumph is for good people and governments to do nothing.”

 

Maine Injured Workers Ass.

http://www.miwa.org/insuranc.html

Occupational Disease

(The following is quoted from the book "Human Debris".)
Occupational disease is the insurance industry's bugaboo. The dark revelation that more than 100,000 Americans are dying each year from this cause has frightened insurance executives. They are apprehensive about the increasing awareness of the contribution of the work environment to the development of many diseases. Substances that we regarded as safe are now known to cause cancer. Heart disease once thought to be strictly non-work-related, is now being linked to stresses at work. If workers' compensation insurers had to pay for any large percentage of the appalling toll of occupational disease, their margins of profit would be seriously affected.

Since no more than 5% of those suffering from occupational disease now receive workers' compensation for their condition, the burden of caring for these disabled men and women has fallen on the public. Social Security, welfare, food stamps, Medicare, and Medicaid take care of the people who should be the workers' compensation insurance industry's charge. In 1980 a total of $1.9 billion, or 13% of the Social Security Disability Insurance (SSDI) Trust Fund of $15 billion, was paid to victims of occupational disease. For the same year. SSDI paid out $500 million for medical care for job-related diseases. Thus, the Social Security system put out $2.4 billion for occupational disease in 1980. This represents money that the workers' compensation insurance industry did not have to pay, although it collects premiums and receives the protection of law under the theory that it and it alone is the appropriate mechanism for compensating workers who have been injured or made sick on the job.

As yet, few occupational-disease claims are filed; fewer still result in compensation. This is OK with insurance industry leaders. Their response to the problem of occupational disease is to deny its existence.

The insurance industry point of view on occupational disease was summed up by John A. Antonakes, vice-president of Liberty Mutual, the largest workers' compensation insurer in the United States. At a seminar on occupational disease sponsored by the National Council on Compensation Insurance, Antonakes said that there were three categories of occupational disease.

1. The commonly accepted occupational diseases such as metal poisoning, silicosis, asbestosis, byssinsis, etc.
2. Ordinary diseases of life such as asthma, emphysema, bronchitis, hearing loss, heart disease, emotional illness.
3. Cumulative injury.

He says that a claim for the first category amount to no more than 3% of all workers' compensation claims and are not expected to increase. As for the second and third categories, if all the potential claims in those groups were compensated, "the costs could be staggering." But in his view, these diseases and resulting disability should not be taken care of by workers' compensation.

The Liberty Mutual executive illustrated his points with the example of byssinosis due to cotton-dust exposure. The problem of the occupational disease, like others, is vastly overstated. He says that the total worker population exposed to cotton dust is 35,000. Of these, about 3500 are at risk of suffering byssinosis to the extent that their working capacity will be affected. Antonakes presented these figures to an audience that wanted to believe him, fellow insurance executives mainly. His numbers are in glaring contrast to those maintained by the federal government's National Institute of Occupational Safety and Health. NIOSH estimates that 300,000 workers are significantly exposed to cotton dust and many more are potentially at risk. At least 35,000 workers are permanently and totally disabled due to byssinosis, and 800 more become totally disabled each year.

As for "ordinary diseases of life" and cumulative injury, Antonakes implies that these should not be compensable. He warned that "If public policy requires that compensation be provided to diseased workers whose employment had only a peripheral influence over the disease itself, then we would have serious doubts as to the capacity of the workers' compensation system as presently structured to handle the potential flood of claims."

The key word in this statement is "peripheral." Antonakes is raising the issue of "arising out of and in the course of employment," the "AOE/COE"test that is the main issue in litigation of occupational-disease cases. The public-policy issue is whether workers' compensation should cover diseases that are partly caused by work - should such diseases be deemed AOE/COE? Antonakes believes, like almost all insurance people, that they should not be compensable. The worker who smokes whose probability of developing lung cancer increased fourfold by working around asbestos would not agree.

Antonakes expresses the point of view of most workers' compensation insurance executives, content with the old way of doing things and no wanting to change to keep pace with a changing world. The absurdly low figures of people at risk of byssinosis, the firm refusal to consider modifying the compensation system to take care of "ordinary diseases of life" that are actually caused by work these are signs of a kind of denial that strangely parallels the denial or workers who have been exposed to occupational-health hazards. Hoping for the best, compensation insurers take comfort from the fact that past occupational-disease claims have been few and the present rules of compensation litigation make it very difficult for diseased workers to win a claim.

Antonakes' comfortable and self-serving view of the occupational-disease question is implicitly refuted by the leading expert on workers' compensation it pertains to occupational disease. Peter Barth, in his Workers' compensation and Work-Related Illnesses and Disease, says that the estimates of 100,000 occupational-disease-caused deaths per year may be too high or too low.* No one knows what a really accurate number would be, because there is no agreement about the definition of occupational disease. But, he says, "in absolute terms the occupational-disease problem is a large one,' and "the evidence suggests that the workers' compensation system in the united States is dealing with very few cases of occupational disease."

Another of the small group of experts in workers' compensation believe that there already is a crisis in the workers' compensation system as a result of occupational disease. John F. Burton, Jr., former chairman of the National Commission on State Workmens' Compensation Laws, declared at the same National Council on Compensation Insurance seminar where Antonakes spoke that occupational-disease cases are already inundating workers' compensation. Back strains and sprains, which accounted for 20% of workers' compensation claims in 1980, have traditionally been classified as traumatic injuries rather than occupation disease. But, Burton says, most bad backs are actually caused by disease, rather than by traumatic injury. When workers' compensation case-law developed, back injuries were mainly the result of a trauma and resulted in a herniated disc. Now there are at least three other types of back problem that result in disability and are the subject of workers' compensation claims. These other conditions are found in the general population and are virtually impossible to link to a specific event, such as an accident at work. Burton says, "...while it is apparent that a set of legal rules can be superimposed on back cases to distinguish those that are work-related from those that are not, we ought to recognize that from a medical of scientific standpoint those rules re pure hokum."

Burton's conclusion is that in order for workers' compensation to properly compensate occupational disease, it must do away with the work-relatedness test. The AOE/COE issue should simply be eliminated from consideration in occupational-disease cases. In a sense, Burton confirms Antonakes when the latter says that workers' compensation "as it is presently structured" cannot handle the "potential flood of claims" due to occupational disease. To remove the work relatedness test is to radically change workers' compensation, to restructure it in a basic way. Perhaps that's just what is needed.

*Peter S. Barth with H. Allen Hunt. Workers' Compensation and Work-Related Illnesses and Diseases. First edition. Cambridge, MA: MIT Press, 1980, p.255.

 

Litigation

Most occupational-disease cases are litigated. These claims are usually begun by a worker's lawyer filing an application with at the state agency, asking it to adjudicate the claim. Insurance executives point to this circumstance to show that occupational-disease claims are an unwarranted burden on the system. In fact, the reason for the great amount of litigation is that insurance carriers will not pay reasonable compensation without being ordered to by the state agency.

An important reason for carriers' intransigence is that in any particular claim there are usually two or more insurers involved. Workers' compensation coverage, like other insurance coverage, is for limited periods. An employer may have more than one compensation insurer over a period of years or an employee may work for a number of employers, each having a different insurance carrier. A carrier is responsible to pay workers' compensation only for injuries occurring during the period it covered a particular company and its employees. But occupation disease often takes years to develop. Thus, many insurers may potentially be responsible for a single claim. Insurance carriers make it a point of honor never to pay any part of a claim that may be the responsibility of another carrier. Injured workers come and go but competitors are always there. Reputations of claims managers and insurance company lawyers are made or lost depending on cases that involve other carriers. A good reputation, given the values of the industry, means you don't pay out a dime more than you absolutely have to. It is common for litigation to go on for years simply over the issue of which carrier is to pay the claim. All parties may agree that the worker should be compensated, but he or she just has to wait until this issue is finally settled.

The painfully slow nature of workers' compensation litigation works to the benefit of the insurance carrier. Delay is the friend of the carrier. There are several reasons for this.
Insurance companies earn a good part of their income from investing their reserves. The longer they hold on to their money, the richer they get. If a worker is disable in 1979, but does not get compensation until 1981, not an unusual circumstance, the insurance carrier has had the use of two years' worth of his or her compensation in a high-interest investment market. Also, in most states benefits are determined as of the day of the accident, regardless of when payment is actually made. The carrier that delays payment through litigation is rewarded by being allowed to pay off in dollars that are worth less than they were on the date they should have been paid. Penalties for late payment are usually minuscule and hard for the worker to collect.In California, the penalty for late payment is a 10% augmentation of the particular type of benefit unreasonably delayed. The worker has the burden of proving that the delay was unreasonable. Most workers' compensation lawyers in that state don't even bother to try for this penalty. "Judges" hate to award it - it makes the insurance companies angry.

A more sinister advantage for delay involves death benefits. The worker who has contracted asbestosis or cancer as a result of exposure at work cost less dead than alive. In most states, if a worker can prove his or her condition compensable, the insurance carrier has to pay much more in medical bills and total disability payments than in the death benefits. It is cheaper for a carrier to litigate a case for years, if need be, until the worker dies than to pay while he or she is still alive. Death benefits are payable only to a dependent spouse and children; other next of kin are not entitled to them.If a single man or woman, or a widow or widower or divorced person with grown children, is killed on the job, the carrier is responsible only for a small burial allowance. these workers are bargain-basement specials for insurers; all they have to pay is a burial allowance. In 1981 in New York this wa $1250; in California $1500.

Workers' compensation cases, unlike ordinary negligence cases, do not "survive" the death of the worker inmost states. If a person is killed off the job through someone else's negligence, his heirs, whether dependents or not, could collect most of the damages the victim could have collected had he survived. In addition many states allow suits to be brought by next of kin for "wrongful death." The disparity between workers' compensation, with its paltry death benefits, and the law of negligence as it has developed in this century is a commentary on the legal ghettoization of the American worker in the workers' compensation system.

Workers' compensation was designed as a no-fault system in order to eliminate litigation and to ensure prompt payment of benefits. It was made the "exclusive remedy" on the assumption that it would compensate all work-related injuries and diseases if most all at the beginning, then eventually. But, as we've just seen, the system is rife with litigation. Injuries and diseases that are caused by work are not being compensated. Delays are robbing injured workers of the value of their benefits as well as hope for a new beginning.

Meanwhile, rates are going up and employers are becoming increasingly restive. Every increase in benefits brings with it an increase in rates, in a seemingly classic example of the inflationary spiral. Yet benefits are still too low. And too few work-related disabilities are being compensated, especially occupational-disease cases. There just doesn't seem to be enough money in the workers' compensation system to take care of all the people who should be taken care of.

When there isn't enough money to run a social-benefit program the way it has been run in the past, there are two basic avenues of change. They are not mutually exclusive, but generally those who are interested in one approach are not interested in either . One approach is to focus on benefits and attempt to restrict them in someway. The other approach is to change the method of financing to provide more money for current benefits and for the possibility of expansion of benefits in the future if necessary.

The insurance industry has attempted to effect "reform" by restricting benefits. Insurance spokesmen seem to have convinced themselves, and are trying to convince others, that all the problems of workers' communications are the result of wildly liberal "judges" giving away huge sums of money to undeserving cheats at the insistence of unscrupulous plaintiffs' lawyers. It is this nefarious group of troublemakers, insurers allege, that is plundering the system.

These arguments obscure the underlying reality of workers' compensation. It is a system controlled in most details by the insurers themselves. Workers have only the right to contest a denial of benefits, but insurers hold the money and the power. Employers, particularly small ones, have no right at all. They must buy compensation insurance at rates prescribed by law.

Some of these abuses that insurance people talk about do happen. Occasionally someone fakes an injury or a compensation "judge" makes an award of unwarranted liberality. But it is not possible to believe that great numbers of American workers are attempting to freeload off an overgenerous workers' compensation system, just as it is incredible that there are great numbers of too-liberal "judges."

The financial problems of workers' compensation don't really have to do with benefits at all. It's the other end of the system that has to be examined to explain why premiums are so high and benefits so low. It's not the payout to the workers that is causing the crisis, it is the sheer inefficiency of a system that allows insurers to take billions from employers and give relatively little in return. For the truth is not that injured workers are getting too much but that they are getting much too little.

Electroplater

The problem of toxic chemicals in the workplace is fast becoming the number-one occupational-health hazard in the United States. So many chemicals are being used for so many industrial processes, with so little control over their use, that it is little wonder that more and more workers are becoming sick due to exposure. There are many possible health effects of exposure to toxic chemicals; electroplaters, for example, are subject to no less than thirteen identifiable occupational diseases.

The medical profession has done little to dispel this denial. Very few doctors have the knowledge or motivation to properly diagnose occupational disease. Doctors tend to minimize what they don't understand.

Smith had symptoms years before becoming totally disabled. She was told by her family doctor that she had "bronchitis." It may well be that a family doctor in the denim capital of the world ought to be able to spot a case of byssinosis. This one apparently couldn't. When Smith came back to him with her diagnosis from a doctor in Durham, the family doctor told her that he himself didn't know anything about brown lung.

In not being able to diagnose Smith's condition as an occupational disease, Smith's doctor was typical of general practitioners across the country. Most of them are not familiar with even the most widespread occupational diseases. They rarely take a detailed occupational history from a patient. Their training has not prepared them to deal with this major health problem. American medical schools practically ignore occupational medicine. The average medical student gets one hour of instruction in this field in his entire four hears in medical school.

Family doctors in urban areas are even more unlikely to diagnose an occupational disease than a doctor in a one-industry town like Erwin. It's unlikely that a city doctor will examine more than one or two patients who display similar symptoms due to similar exposure at work. Also, the exposure might have been twenty years before and 2000 miles away.

Large factories or mills always have in-house doctors or nurses. One would think that these medical professionals would be able to identify a disease characteristic of the plant's operation; they must run across it fairly often.

When doctors fail to diagnose an occupational disease there are legal as well as medical consequences. Not only does the worker not get proper treatment, if indeed there is any effective treatment, but he or she will not receive workers' compensation. In order to qualify for compensation, a worker must have a doctor's diagnosis of an occupational disease, a diagnosis that satisfies the workers' compensation requirement that an illness be work-related. Betty Smith could never have received even the small amount of compensation she did get while the diagnosis was "bronchitis." Luckily for Smith, organizers of the Brown Lung Association referred her to a pulmonary specialist in the university of Durham. This doctor finally gave her the proper diagnosis, ten years after her first symptoms.

Doctors are a major bottleneck in the workers' compensation system. When the law was changed in North Carolina and byssinosis became compensable, there was not the flood of claims that one might have expected. Only a few hundred workers got compensation for byssinosis between 19634 ane1979. There were only a few doctors in the state who could diagnose the disease and feel competent to state unequivocally that a worker's disability was caused by exposure to cotton dust at work.

 

John Vandyne's case was a little different. The company doctors who examined him knew that he was developing asbestosis but did not warn him away from the work which they saw was harming him. Johms Manville's behavior in suppressing these findings was so egregious that the asbestos company's California employees were allowed by the Supreme Court to sue their employer despite the heretofore insurmountable bar of the exclusive-remedy provision of the workers' compensation laws.
Richardson's experience was unusual among workers suffering from occupational disease. He found his way to a clinic that had been specially created to diagnose occupational disease and treat its victims. There are only five or six such clinics in the country, but they have had a salutary influence on other doctors int their localities, sensitizing them to the health hazards found in the work place. These clinics provide appropriate treatment to workers made sick on the job and give them some chance to obtain workers' compensation.

We look at what happened to people who worked around asbestos, we have good reason to fear the worst.

Occupational disease is fast becoming one of the nation's top health problems. There are at least two reasons for this. The first is that new technology is filling the American workplace with more untested and dangerous substances than ever before. Besides radiation, those dangers are well documented, there are thousands of new chemicals being invented every year. many of these are highly toxic. The other reason occupational disease is taken so seriously by public health experts is that medical science is beginning to identify as industrially caused much disease which was up to now thought to be nonindustrial. Many types of cancer, lung disease, nervous system disorders, and various other ailments are now suspected of being caused by conditions at work.

Public health problems, like all of society's troubles, cannot be solved until they are first recognized as "problems." While this recognition does not ensure that conditions will in fact get better, it is an absolutely necessary first step in the progress toward reform.

Only when the American public began to believe that there was an "environmental problem," that our air and water were becoming so polluted as to be a menace to our health and that of our children, did political and social change begin to occur.

Working conditions can be greatly improved for millions of people. Not made risk-free, of course, but as healthy as modern technology and human ingenuity can make them. Profound changes will occur when the issue of workplace health and safety becomes a major political issue, one that draws national media attention and delivers large numbers of votes to politicians bright enough to champion the cause.

There are many other stories of occupational illness among the 95% of those afflicted with it who do not receive workers' compensation; enough stories to fill many books: an encyclopedia of suffering.

One of the most dangerous substances created by man is dioxin. if it is popularly known, it is because it was the most toxic ingredient in Agent Orange, the herbicide used to defoliate large areas of Vietnam. Also, there was a great deal of media attention to an explosion in a dioxin-manufacturing plant in Seveso, Italy, in 1977, which contaminated a large area. The effect of dioxin represents a summary of the more serious signs of a number of occupational diseases, particularly in the chemical and atomic industries: chloracne (a skin rash that looks like a bad case of acne and can last for years); liver damage; nervous system and vision impairment; spontaneous abortion; birth defects; abnormal function and derangement of the immune system; and cancer-causing potential - a catalogue of nightmares that is by no means exhaustive.

The frighteningly futuristic world of occupational disease coexists with the old-fashioned system of workers' compensation. The problems of the twenty-first century are being addressed with solutions from the nineteenth. It's no wonder that few occupational disease cases are compensated and that workers' compensation does nothing to encourage employers to maintain healthy workplaces.

There were no signs at the mill warning of the health problems associated with cotton dust. Despite the fact that byssinosis has been a known occupational disease for almost a hundred years, despite the fact that Great Britain passed a byssinosis compensation act in 1940, despite the presence of a union in the mill since the early 40's, it was known in Erwin, North Carolina, that there was a disease caused by cotton dust, that it was called byssinosis, and that it could disable and kill. After the passage of OSHA, byssinosis became a national issue and news filtered down to Erwin through organizers of the Brown Lung Association.

The Insurance Cartel

While the workers' compensation system cannot better the lives of most workers hurt on the job, it is very effective in making rich insurance companies richer. Immune from antitrust laws, the insurance industry has organized itself into a cartel that virtually dictates to employers what they shall pay in workers' compensation insurance and to workers what they shall receive in benefits. From the cradle of rates to the grave of benefits, all is quietly managed by a small group of insurance executives. Operating in welcome obscurity, they accumulate billions of dollars each year.

Workers' compensation is an enormously expensive way to take care of injured workers. Out of every dollar paid in premiums, no more than sixty-five cents is paid out in benefits. In some stated almost fifty cents of each premium dollar is retained by the insurers. By contrast, the Social Security Administration uses only one and a half cents for administrative expenses for every dollar received in Social Security taxes.

The Cartel

The insurance industry is a cartel in the classic sense. Immune by a special federal law from antitrust laws and federal regulation, it has grown into one of the most sophisticated and powerful economic and political forces in our society. Organized and cooperative, American workers' compensation insurers have come to dominate the governmental forces meant to regulate them.

On the fifty-first floor of a skyscraper overlooking midtown Manhattan are the offices of the cartel's nerve center. The National Council on Compensation Insurance decides what workers' compensation insurance will cost in most of the United 'States., It has a low profile, and no doubt wishes to keep it that way, for if its real subject of public scrutiny, and embarrassing questions might be asked. Governed by committees or representatives of the insurance companies that support it, the National Council makes rates for thirty two states and provides critical technical assistance to local rate-making organizations in twelve more jurisdictions. More than 1100 people work for the National Council, which provides services to more than 600 member or subscriber insurance companies.

While all government regulation of insurance is done at the state level, and the federal government regulation of insurance is done at the state level, and the federal government is forbidden by law to regulate it, the insurance industry is tightly organized on a national basis. Few state governments are a match for the technical expertise of the National Council or the political muscle of the insurance-industry trade groups. When the National Council Proposes rates based on national profit and loss data, most state insurance commissioners have little choice but to accept its conclusions, since their resources are pitiful in comparison with those of the National Council.

California and a few other states have different organizations that serve the same function as the National Council and are also creatures of the insurance industry. The California Insurance Rating Bureau, a semi governmental body run by private insurers, has a monopoly on recommendation of rates to the state insurance commissioner.

Workers' compensation insurance is compulsory and its rates are noncompetitive, particularly to small business that does not benefit from experience rating or retrospective-rating plans. The rates are set by the industry itself and are rarely challenged by relatively weak state insurance commissioners. And the rates produce billions more each year than is needed to pay claims and operate the system.

There are three types of workers' compensation carriers, two privately owned and on state owned. There are stock companies, mutuals, and state funds. Stock companies and mutuals write other lines of insurance as well as compensation. State funds are unique to workers' compensation.

When workers' compensation was introduced, some states found that private insurers were so rapacious that many employers would be ruined if they had to pay the premiums that were demanded. Eighteen states organized their own insurance companies, called "state funds", to provide insurance at reasonable rates. Of these, six are "exclusive state funds", in six states only the state fund may sell workers' compensation insurance. The other twelve state funds compete with private insurers and operate for the most part like them. The largest exclusive state funds are in Ohio, Washington, and West Virginia. Of the competitive state funds, California's is by far the largest. State funds are nonprofit, return if their excess to their policyholders. Their degree of efficiency and share of the market vary greatly from state to state, depending essentially on the role determined for them by the state legislature.(End of quote)


The e-mail address for the Maine Injured Workers Association is:
miwa@miwa.org

The mailing address for the Maine Injured Workers Association is:
P.O. Box 85
West Paris, Maine 04289-0085

The web site address for the Maine Injured Workers Association is:
http://www.miwa.org

 

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